Senate panel questions ERHC payments for energy rights

Subpoena delivered to ERHCSenate panel questions payment for energy deals off west Africa

TOM FOWLER, Copyright 2007 Houston Chronicle

Published 5:30 am, Wednesday, July 11, 2007

Houston's ERHC Energy has been subpoenaed by a Senate subcommittee looking into possible improper payments related to ERHC's oil and gas holdings around the island nation of São Tomé and Príncipe.

The Committee on Homeland Security and Governmental Affairs' Permanent Subcommittee on Investigations sent the subpoena on Thursday asking for documents "in connection with its review of matters relating to the potential abuse of payments made to foreign governments," according to a statement by ERHC Monday.

Senate investigators are particularly interested in information "related to the acquisition of ERHC's interests in the Gulf of Guinea," where ERHC has the right to drill for oil and gas off the coast of São Tomé, the company said.

In the statement, interim CEO Nicolae Luca said ERHC believes development rights it negotiated with São Tomé over the past decade were "legitimately awarded to ERHC."

A spokeswoman for the Senate subcommittee declined comment on the investigation.

In December 2005, São Tomé's then-attorney general called on the U.S. to investigate ERHC's dealings in the region, saying in a report that ERHC and politically connected Nigerian businessman Emeka Offor "may have made improper payments to government officials."

Last year FBI agents raided ERHC's offices in Houston looking for possible "things of value" paid to officials in São Tomé and Nigeria, an FBI affidavit filed in Houston said.

Last month the U.S. Securities and Exchange Commission issued a subpoena to Sugar Land attorney O.J. Chidolue, an employee of a major ERHC shareholder, ordering him to hand over documents and speak with federal investigators.

According to court filings Chidolue and the SEC reached an agreement where he would provide the documents by June 29 and testify on July 18.

It could not be determined Tuesday if those terms have been met. SEC officials declined comment. Chidolue and his attorneys could not be reached.

ERHC has signed partnership deals with Swiss firm Addax Petroleum and China's Sinopec Corp., and said in a statement this week the companies were on target to begin drilling test wells off the west African coast next year.